- I'm here today with
Dr. Kishore Mahbubani. He is the distinguished fellow at the Age of Research Institute of the National University of Singapore. We're here to discuss his
new book Has China Won, The Chinese Challenge to American Primacy. Thanks for joining us. - My pleasure. - I can't think of a more
important playing field on planet Earth to zoom in and explore than the one you have chosen. What inspired you to write this book? - Well, I see a great tragedy coming and it's a completely unnecessary tragedy, this coming geopolitical contest between the United States and China. And the basic message in my book is a very simple one which is that a geopolitical contest between the United States and China is both inevitable and avoidable. So I try to explain in
the main part of my book why it's inevitable and why also the United States
should really think very hard and deep before it plunges into this geopolitical contest with China. - So where did the pressure mount that put us on this inevitable trajectory which is so dangerous? You can speak to both American
and Chinese contributions. - Well I think it's clear that both sides have
made strategic mistakes that in some ways led to the eruption of this geopolitical contest. But in a more fundamental way the geopolitical contest was actually in some ways inevitable because the history
teachers 2,000 year logic which to some extent Graham
Allison has captured in his book Destined for War, that whenever the world's
number one emerging power, which today is China, is about to overtake the
world's number one power, which today is the United States, that inevitably the
geopolitical contest breaks out and then both get locked into a struggle. But of course, the other question is what triggered it now? And the trigger was caused
by strategic mistakes made by both China and the United States. In the case of China, what I try to document in the book is that there was for a long time a very powerful constituency
in the United States, the American business community, that was so engaged with China, making lots of profits from China, and therefore that constituency
always applied the brakes whenever the United States
seemed to be heading towards a struggle against China. - They used to have these treasury reports and within the currency manipulator and they always stopped
shy of declaring that. - Exactly, you're absolutely right and that actually is a demonstration of the point I was gonna make. And what happened was
that this time around when Donald Trump launched his trade war, the logical thing should have been for the American business
community to say stop, we have a lot of stake with China. Instead, they just stepped aside and allowed the trade war to carry on against China. So that was China's big strategic mistake. But as I try to document in the book, the mistake made by the United States was in many ways much bigger. And it was a bigger mistake because the United States decided to launch a major geopolitical
contest against China without first working out a comprehensive, long term strategy on how you deal with a country that has got a population that's four times bigger and the United States
is only 250 years old, less than 250 years old. China has been around 2,200 years. And what is shocking is
that no thought was given to this at all. And this insight was given to me actually as I documented the
book, by Henry Kissinger, in a one on one lunch I
had with him at his club. And so that thought led
me to investigate further about what are the
potential other mistakes the United States is making in proceeding with this
geopolitical contest? So the goal of my book is actually to help United
States, help Americans, to think very hard and very deep before they take on an assignment which future historians will marvel at that they just jumped in two feet first without thinking hey, what
am I getting myself into? - Well I sense inside of
American political economy there's almost a page from
the playbook of Bismarck. If you can't solve your problems inside, look outward and pick an
enemy to unify your people. And the problems, which you cite very
eloquently in the book, of more than half the population having a declining standard
of living since 1989, is really quite daunting
and quite distressing. - Yes, you see what I've
tried to point out in the book is that there are lot of misconceptions that Americans have
about their own strengths and about China's weaknesses. So for example, it is taken as a given, it's like ideological certainty that when a thriving democracy takes on a geopolitical struggle against a communist party system, the thriving democracy will always win, as it demonstrated in the first world war against the Soviet Union. But then if you dig deeper and you try to understand what is the core situation
of American society today and the core situation of Chinese society, you discover that the United States is actually having to deal with some major structural challenges. And one of the key structural challenges is that the average
income of the bottom 50%, yes 50% of the American population has been sliding down
over a 30 year period. And as I try to analyze in the book, this is not just an accident. This is a result of deep structural forces in American society that have moved America away
from being a thriving democracy towards becoming a plutocracy. And by contrast, China in the 30 year period where the average income of
the bottom 50% in America has been sliding down, in the same 30 year period, the bottom 50% in China have had their best 30
years in 3,000 years. So at a time when the Chinese people are experiencing the
most amazing improvements in their standard of living, you must remember also for most of Chinese history, the bottom 50% struggled to survive. They would die in famines and civil wars and they had a very rough life. And the last 30 years, they have access to education,
housing, health care, travel, in a way they never ever
had before in their lives. So after China has gone through the best 30 year period ever under the Chinese communist party, the United States is
telling the Chinese people why don't you get rid of
the Chinese communist party? And the Chinese people
are scratching their head and saying, excuse me,
I've had the best 30 years. And the Chinese communist
party is succeeding because while in theory it
is still a communist party, it is a communist party
that is the exact opposite of the Soviet communist party. Because the Soviet community party was run by all operatics. The Chinese communist party may possibly be the most
meritocratic political party in the world. And the selection process results in the best minds running China today. You met some of them
- And experienced. - You know Yan Xishan you know how brilliant these people are. So by going into this
whole ideological reflex and saying, hey, democracies can always
overcome communist parties, the United States hasn't
done a deeper analysis and realized that this is not a contest within a democracy and a
communist party system, it's a contest within a
plutocracy and a meritocracy. - You talked about it being
a party of representation. How that is maintained, whether that is stable, is still true for the last 30 years. - Yes. At the end of the day, running China, keeping a country of 1.4
billion together every day is a massive challenge, which is why for most of Chinese history, China has more often
been divided than united. So the period like what
China has experienced for the last 30 years with a strong central government delivering phenomenal
improvement in living standard to its people is very rare in Chinese history. And so if you compare
the record in governance of the Chinese communist party, especially after Deng Xiaoping
launches Four Modernizations 40 years ago in 1979, it's quite amazing what
China has accomplished. And the Chinese must always measure the record of their governance not against what other
countries have achieved but what has been achieved
in Chinese history. And no Chinese government
ever in Chinese history has improved the living
standards of the Chinese people as much as the Chinese
community party has. And you're right, I call it the Chinese civilization party because the main goal of
the Chinese communist party is not to promote or to
export communist ideology. The main goal of the
Chinese communist party is to revive Chinese civilization and bring it back to
the standing and respect that it used to enjoy in the world for over 2,000 years. And the key driving force
in the Chinese mind, which I think every
American should be aware of is that the Chinese are acutely aware that they went through
something like maybe 150 years of national humiliation starting from the opium war of 1842 going up to the Japanese occupation and so on and so forth. So they've gone through
a lot of humiliation and their desire, therefore, is to regain the respect
that China used to enjoy. And it is somewhat sad
that just at the moment when the Chinese people feel that hey, we are now finally
achieving something meaningful, that's the time when America
decides to slap China. The only thing to remember is you see, they're trying to humiliate us again. - And the scar tissue in the United States echoes of the cold war visa vie the USSR. And in your book you do a very nice job of showing why the Chinese challenge is very different than
the Soviet challenge in terms of weaponization and arms race, in terms of ideology, there are just many aspects that you desegregate. - Yeah, well I think you know the reason why I encourage Americans to think deeper is that if they look very carefully at the track record of what China is doing and what the Soviet Union is doing, it is actually quite shocking that in the geopolitical contest today between China and United States, instead of China behaving
like the Soviet Union, it is the United States that's behaving like the Soviet Union because I explain in the
book in one chapter, I ask, can America make mutants? So for example, the contest
between United States and China, will not take this in the military sphere. It will be in a nuclear war
between United States and China, there will not be a winner and lower, there will be a loser and loser. So logically, it should be in the interest of the United States therefore to reduce its defense budget and take the money and invest in R&D because that's where the real contest is. But the United States cannot
reduce its defense budget because no matter how brilliant a defense secretary you have, whether it's Ash Carter or General Mattis, because the process of
deciding where to spend money is locked in by the US Congress and allocations are made
to each constituency by the congressmen and therefore the defense budget is large, irrational and unnecessary. If the United States was
serious about taking on China, it should cut its defense budget in half but that's impossible. And in that so, it's like the old Soviet Union that also couldn't cut its
defense budget into half. So in that sense the United
States hasn't thought very hard and very deep about how different this
contest with China is whereas by contrast, the Chinese are quite happy, they're growing their defense budget but at a fixed percentage of their GNP and not increasing it. And the Chinese are very happy that America has 13
aircraft carrier fleets 'cause each aircraft carrier fleet is draining millions of dollars away from the US Treasury every day and paradoxically, in military terms, an aircraft carrier
today is a sitting duck and as an American professor, Tim Colton of Harvard told me, it just takes $100,000 hypersonic missile to bring down a billion
dollar aircraft carrier. It doesn't make sense anymore. So clearly you need to have a
fundamental strategic reboot in American thinking. And in that sense, I'm trying to be helpful
to America and say, think very hard about what are the big
changes you need to make. - One of the things that
haunt people who are talking about "new economic
thinking" and technology is the interface between this rivalry between the US and China, digital commerce platforms
and cybersecurity. And the story goes, these are my friends at MIT again talking that if you set up a digital platform it aggregates a lot of information. Hackers are able to use
virtual private networks and disguise their identity
and their whereabouts. So a hacker can be in Saskatchewan
in Canada hypothetically pretend to be New York attacking Shanghai or be in Armenia pretending to be Beijing
attacking Washington DC. I've talked to leaders in both countries, very high leaders, they recognize that given
all the other tensions and rivalry and scar tissue from history and potential for misunderstanding that they do not have a way to verify, let's say you make an agreement, we both pledge our trust to abide by the cooperative behavior, with the success and the presence of disguised hackers, you can't verify whether that's the case. And people are struggling now to try to figure out how to overcome this because if you vulcanize the internet and the trading systems, you're accelerating that polarization into competing systems. And I don't know how to answer that but I think it's a fantastic
question to be exploring. - It is, you're absolutely right. And this is where one of
my key recommendations in the book is that if you want to find solution, there will be, of course, many challenges in the relations within the
United States and China, not just in cybersecurity, law of the sea, maritime areas, and
many, many other areas. The best solution is to look
for multilateral solutions. And in the area of
cybersecurity and cyberwarfare, it's good to agree on
one common set of rules. And I'll give you a simple example. Nowadays with a good hacker can in theory unleash the waters of a dam, right? And then can you imagine the thousands of people who will die when the dam suddenly bursts, right? So why not agree on one set
of multilateral set of rules, at least agree on the rules first, of course implementing it
right will be a challenge but agree we will never attack a dam, we will never attack a hospital, we will never paralyze
the electricity of a city, we will never sort of thing. So you have at least common
sets of areas where you agree. And of course, frankly, it would make perfect sense for an American military to hack into a Chinese
destroyer, of course, that's fair game, and vice versa too, so that's fair game but let's make sure you
carve out areas and we say, in these areas you don't do anything. But of course, the interesting
exception to all this, and as you know, since you're a monetary person, I point out that the real achilles heel of the United States is the fact that the US dollar is the global reserve currency and that, as you know, as French then finance
minister started saying exorbitant privilege, enables Americans to
live beyond their means. So it's in America's national interest to preserve the US dollar as
the global reserve currency. But by weaponizing it, the United States has created incentive for countries to move
away from the US dollar. And it is conceivable for China to use block chain technology to create not necessarily
a new monetary system but just a platform that enables countries to trade with each other without having to use the US dollar. And the minute the US dollar is no longer the dominant
currency in global trade, it can still of course remain strong in the financial spheres, but once the critical part of the system where it's no longer essential
for global trade disappears, the US dollar becomes vulnerable. And if it is no longer a
global reserve currency, then American standards
of living will go down. And that's another example of where it is in interest of
the United States and China to work together. - Thank you for joining us. - Thank you very much.
Mahbubani has a good point about CCP’s name should be Chinese Civilization Party. Because it’s ultimate goal isn’t to make sure the world become communist like the USSR. CCP’s sole purpose is for the Chinese people to become prosperous and the Chinese civilization to be reinvigorated, no matter the ideology.
The idea that the CCP is agnostic about ideology and only pursues practical results is a gross misunderstanding.
The CCP cares very much about ideology. The difference between it and other ideologically bent political parties is that the CCP approaches ideology as a science, not a religion. Nothing is taken for granted, and nothing is sacred.
We Chinese love to study history, probably more so than any other country. The fall of the USSR, the rise of Postwar America, the fall of American Empire, these are all topics that the senior cadres have analyzed and continue to analyze.
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The bottom line is that Chinese civilization is blessed with a culture that promotes and values intellectualism, scholasticism, and hard work. This is how we've been raised since the Han Dynasty, and it's not likely to change any time soon.
The CPC emerged out of the KMT purge of leftists, and sought to distinguish itself by condemning "traditional" or rather "feudal" Chinese values and equating modernization with soviet communism. Things did not go as planned under Mao when modernization hit a wall with the Sino-Soviet rift, and changing feudal ways deteriorated into a chaotic Cultural Revolution. It was during a very frustrated time for China when Deng came up with "Socialism with Chinese Characteristics" just in time to take advantage of some big historical changes. When the ROC fell to "western democracy", the KMT lost its "nationalist" agenda and became just another petty party in Taiwan, and the CPC was able to become the sole party to really uphold Chinese values and national interests. Then, the Soviet Union fell and China was able to ride out "failure of communism" by continuing reform and opening up under its own socialism banner. The CPC of today has come a long way from the CPC of last century. It has re-embraced Chinese traditional values as a point of pride and stability for the nation, and has achieved modernization by engaging with the capitalist/imperialist world in a mature and pragmatic way with both cooperation and competition. The progress in the CPC and the PRC is very much like a frustrated teenager turning into a responsible adult. What's ironic is that the western world has regressed in the other direction.
as Darkmaster006 and unclecaramel point out, China is indeed communist/socialist. so is Kishore Mahbubani wrong?
one thing you have to realize about him is he is a true diplomat -- he adapts his message to the audience he addresses. for example, look at his piece in the National Interest -- which is US establishment media -- about Trump helping China. you can tell his entire framework and language is different when talking to americans.
so his saying the CCP is not the "Chinese Communist Party" but the "Chinese Civilization Party" is meant to clear up a certain misunderstanding. it is a kind of 方便 or 'expedient means' in which the truth can be repackaged in ways the audience can better understand and benefit from.
for a chinese audience, he would not say that the CCP is not communist, because Chinese understand that word differently from americans brainwashed by cold-war thinking.